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RPC Inc (RES 1.96%)
Q4Â 2018 Earnings Conference Call
Jan. 23, 2019, 9:00 a.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
See all our earnings call transcripts.
Prepared Remarks:
Operator
Good morning and thank you for joining us for RPC Inc.'s Fourth Quarter 2018 Financial Earnings Conference Call. Today's call will be hosted by Rick Hubbell, President and CEO; and Ben Palmer, Chief Financial Officer. Also present is Jim Landers, Vice President of Corporate Finance.
At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. Instructions will be provided at that time for you to queue up for questions. I would like to advise everyone that this conference call is being recorded.
Jim will get us started by reading the forward-looking disclaimer.
Jim Landers -- Vice President of Corporate Finance
Thank you and good morning. Before we begin our call today, I want to remind you that in order to talk about our Company, we're going to mention a few things that are not historical facts. Some of the statements that will be made on this call could be forward-looking in nature and reflect a number of known and unknown risks.
I'd like to refer you to our press release issued today, along with our 2017 10-K and other public filings that outline those risks, all of which can be found on RPC's website at www.rpc.net.
In today's earnings release and conference call, we'll be referring to two non-GAAP measures of operating performance. The first is EBITDA. RPC uses EBITDA as a measure of operating performance, because it allows us to compare performance consistently over various periods without regard to changes in our capital structure.
We are also required to use EBITDA to report compliance with financial covenants under our revolving credit facility. The second set of non-GAAP financial measures are net income and diluted earnings per share excluding the impact of tax reform. Management believes that presenting our 2017 operating results without the impact of tax reform enables us to compare RPC's operating performance during the fourth quarter and full year of 2018 to 2017 consistently.
Our press release issued today and our website contain reconciliations of these non-GAAP financial measures to net income and diluted earnings per share which are the nearest GAAP financial measures, please review these disclosures. If you're interested in seeing how they are calculated.
If you haven't received our press release for any reason, please visit our website at www.rpc.net for a copy. I will now turn the call over to our President and CEO, Rick Hubbell.
Richard A. Hubbell -- President and Chief Executive Officer
Jim, thank you. This morning, we issued our earnings press release for RPC's fourth quarter of 2018.The unexpected decline in oil prices, budgetary constraints and holiday slowdowns during the fourth quarter of 2018 impacted our customers' drilling and completion activities with many curtailing operations in December. This decline was most pronounced in our pressure pumping service line. Our CFO, Ben Palmer will now review our financial results in more detail, after which, I will have a few closing comments.
Ben M. Palmer -- Chief Financial Officer
Okay, thank you, Rick. For the fourth quarter, revenues decreased to $376.8 million compared to $427.3 million in the prior year. Revenues decreased compared to the same period of the prior year, due to lower activity levels caused by year end budget depletion among many customers. EBITDA for the fourth quarter was $61.7 million compared to $101.1 million for the same period last year. Operating profit for the quarter decreased to $19.7 million compared to the $60.3 million in the prior year. Our diluted earnings per share was $0.06 compared to $0.18 diluted earnings per share in the prior year, excluding the impact of tax reform. RPC's effective tax rate in 2018 was 21% compared to 30% in 2017.
Cost of revenues during the fourth quarter was $274.4 million or 72.8% of revenues compared to $285.7 million or 66.9% of revenues during the same period last year. Cost of revenues decreased due to lower materials and supplies expenses within RPC's pressure pumping service line, as well as lower maintenance and repair expenses. As a percentage of revenues, cost of revenues increased due to labor inefficiencies caused by lower activity levels within pressure pumping. Selling, general and administrative expenses were $40 million in the fourth quarter compared to $42 million last year. As a percentage of revenues, these costs increased from 9.8% in the prior year to 10.6%, due to lower revenues and the relatively fixed nature of these expenses during the short term. For the full year 2018, selling, general and administrative expenses as a percentage of revenues were 9.8% compared to 10% in 2017.
Depreciation and amortization expense was $42.6 million during the fourth quarter of '18, an increase of 11.9% compared to $38 million in the prior year. Our Technical Services segment revenues for the quarter decreased 13.1% compared to the same quarter in the prior year, and operating profit decreased to $19.9 million compared to $67 million in the prior year. These decreases were due to lower activity and lower pricing within our pressure pumping service line.
Our Support Services segment revenues for the quarter increased 20.8% and operating profit improved to $2.5 million compared to an operating loss of $1.6 million in the same period last year. On a sequential basis, RPC's fourth quarter revenues decreased 14.4% to $376.8 million from $440 million in the third quarter. Revenues decreased due to lower activity levels and slightly lower pricing. Cost of revenues during the fourth quarter of '18 decreased $26.5 million or 8.8% primarily due to decreases in variable costs, including materials and supplies, fuel and maintenance. As a percentage of revenues, cost of revenues increased 4.4 percentage points from 68.4% in the third quarter to 72.8% in the current quarter. This was due primarily to the relatively fixed nature of employment cost during the short term. Selling, general and administrative expenses during the fourth quarter decreased by 4.2% compared to the third quarter. RPC's operating profit during the fourth quarter of 2018 was $19.7 million compared to $54.6 million in the prior quarter.
Our EBITDA decreased from $97.8 million in the prior quarter to $61.7 million in the current quarter. Technical Services segment revenues decreased $64.2 million or 15.3% to $357 million. Operating profit was $19.9 million compared to $56.2 million in the prior quarter. Our Support Services segment generated revenues in the fourth quarter of $19.7 million or 5.3% higher than the prior quarter. Operating profit was $2.5 million in the fourth quarter compared to operating profit of $1.8 million in the prior quarter.
Our pressure pumping fleet remains at approximately 1,050,000 hydraulic horsepower. And during the fourth quarter of 2018, capital expenditures were $43 million and our full year '18 capital expenditures were $243 million. We currently estimate that 2019 capital expenditures will be approximately the same amount but could be less if conditions warrant.
At the end of the fourth quarter, our cash balance was $116.3 million and we continue to have no outstanding debt.
With that, I'll turn it back over to Rick for a couple of closing comments.
Richard A. Hubbell -- President and Chief Executive Officer
Thanks, Ben. During January, several customers notified us that they were concerned about the current oil prices and are reevaluating their 2019 budgets. This and current market conditions require us to be cautious regarding our early 2019 outlook. However, we remain focused on executing over the long term. Although 2018 was challenging, we maintained our commitment to RPC shareholders through our dividends and share repurchases.
Our strong balance sheet, conservative approach and management experience will allow us to manage through the near term uncertainties. We've always focused on maximizing on invested capital and will continue to use this key metric to manage our business. Thank you for joining us for RPC's conference call this morning. At this time, we will open up the lines for your questions.
Questions and Answers:
Operator
(Operator Instructions) And we'll take our first question from Marc Bianchi with Cowen.
Marc Bianchi -- Cowen -- Analyst
Thank you.
Richard A. Hubbell -- President and Chief Executive Officer
Hi Marc.
Marc Bianchi -- Cowen -- Analyst
Hi, good morning. I'd like to ask about the comment regarding customer budgets and the changing plans, what were these customers telling you before and what's your best guess on where they're headed in 2019 and also near term here in the first quarter.
Ben M. Palmer -- Chief Financial Officer
Marc, this is Ben. Obviously very difficult question. The price fell obviously tremendously during the fourth quarter. Everybody was concerned as that begun to happen and I think are still a lot of uncertainty in their minds. The '19 budgets, of course, they set those before the end of the year. It's not like they're shutting down, but they're just a little more cautious at this point in time about how aggressive or how -- they're just going to manage it carefully just like we're trying to manage our business, so all things being equal, they'll remain cautious and would set to react accordingly.
Jim Landers -- Vice President of Corporate Finance
Mark, this is Jim. We believe that oil prices fell at a difficult time of the year because it was our customers' budgeting season. So the oil price decline happened as they were budgeting. Now in January, oil is up a little bit, but they're extremely uncertain about what 2019 looks like.
Operator
All right. We'll move on to our next question. Next, we'll go to Chase Mulvehill with Bank of America Merrill Lynch.
Chase Mulvehill -- Bank of America Merrill Lynch -- Analyst
Hi, good morning, gentlemen.
Richard A. Hubbell -- President and Chief Executive Officer
Hi Chase.
Chase Mulvehill -- Bank of America Merrill Lynch -- Analyst
I guess, first one, can I come back to the CapEx, you're kind of saying more or less kind of flattish. Can you talk about the ability to kind of -- scale that down, if the environment, where it's -- scaling that down and maybe talk about how much of your CapEx in a flat environment is kind of replacement or kind of new build equipment.
Ben M. Palmer -- Chief Financial Officer
Chase, this is Ben. We do have some ability to manage that down. We have ordered some additional pressure pumping equipment that will come in toward the middle of next year. This is a decision we didn't take lightly as something we've evaluated over time. It's like Rick indicated in his comments, we are trying to manage things over the long term. So we think it's the right decision for us as we're committed to the industry and we think it still provides over time a great return, will provide a good return, adequate return for us and our shareholders. So and that'll be about a 10% addition to the fleet. But in terms of those numbers, we're indicating out -- so we're saying about $240 million, $250 million in CapEx next year. And in terms of maintenance and growth, Jim, help me out what did we...
Jim Landers -- Vice President of Corporate Finance
Probably -- it's probably 60% maintenance, 40% growth,Chase.
Chase Mulvehill -- Bank of America Merrill Lynch -- Analyst
Okay.
Jim Landers -- Vice President of Corporate Finance
And we have started placing some orders for some pumps, but there's some flexibility as Ben indicated on either moving it back or differing things, should we need to.
Chase Mulvehill -- Bank of America Merrill Lynch -- Analyst
Okay, in that 10% additional horsepower, is that a gross or a net number?
Jim Landers -- Vice President of Corporate Finance
Well, it's additional horsepower, period. We are thinking of it as two additional fleets coming in the middle of the year.
Chase Mulvehill -- Bank of America Merrill Lynch -- Analyst
Okay, all right and then as we...
Jim Landers -- Vice President of Corporate Finance
So...
Chase Mulvehill -- Bank of America Merrill Lynch -- Analyst
Okay, all right, so it's net two fleets, all right. And then if we think about the dividend and CapEx and the uncertainty around the macro, how should we think about the dividend? Do you need to cover it with free cash or is it free cash plus cash and you just won't pay your dividend with debt. So, generally, just how do we think about the dividend sustainability of it?
Ben M. Palmer -- Chief Financial Officer
Well, it depends on how '19 unfolds and how we eventually see or believe that 2020 will roll out, historically, I mean, we've been conservative in managing our balance sheet and so forth. We've obviously maintained the dividend which give some indication that we believe it's sustainable at this point in time, but we'll react quickly, we have those levers available to us. And so it's too early to tell. We obviously don't -- I don't -- we don't here make decisions for the Board, but we will follow with them and at this point in time, we believe that it's intact and sustainable.
Chase Mulvehill -- Bank of America Merrill Lynch -- Analyst
Okay, I'll jump back in the queue, thanks, Jim, thanks, Ben.
Operator
All right, we'll go to our next question, James Wicklund with Credit Suisse.
James Wicklund -- Credit Suisse -- Analyst
Good morning, guys.
Richard A. Hubbell -- President and Chief Executive Officer
Hi Jim.
James Wicklund -- Credit Suisse -- Analyst
I noticed in the review of Q4, that it was the down -- 14.4% down is coming through is lower activity and slightly lower prices. And we were just all kind of wondering, what slightly looks like in Q4 and of course the expectation is because Schlumberger and Halliburton have already kind of hinted at us that pricing in Q1 could be down in another 10% to 15% from Q4.
Can you guys kind of put some numbers around where you think -- just short term, what happens to the rest of the year, who knows. But just short term, what pricing is looking like in pressure pumping?
Richard A. Hubbell -- President and Chief Executive Officer
Go ahead.
Jim Landers -- Vice President of Corporate Finance
Jim, this is Jim. The Q4 answers are lot easier than the Q1 answer. We believe that just based on our price book and how our discounts run, pricing declined 2% sequentially between third and fourth quarter in pressure pumping,
James Wicklund -- Credit Suisse -- Analyst
That's fabulous.
Jim Landers -- Vice President of Corporate Finance
So obviously, activity -- so active -- well -- so activity declined a lot more. We are trying to find the balance right now of optimizing our EBITDA by finding the right mix of pricing and utilization.
Fourth quarter was an anomaly because we had people who absolutely shut down in December. But taking those seasonal things away, we now need to find in the current environment, the optimal mix between pricing and utilization. How much farther our -- or how much our pricing needs to climb in first quarter to get to that mix is not known to us right now, we just got to test the market which our marketing and sales teams are doing as we speak, figuring out where that level is. So we don't have a number.
James Wicklund -- Credit Suisse -- Analyst
We're about a month end, but no early indicators yet. Okay, and my follow up if I could. Returns, I'm not going to make a big deal about it. But you talk about, you're focused on return on invested capital. Can you just talk just a little bit about what that discipline is and how you determine what it is and kind of what do you think your cost of capital will be or should be? Can you just talk about around those metrics a little bit just because nobody in this industry generated consistent positive returns for a while and so that gives everybody a chance to scramble, but what do you guys look at as a return to invested capital type hurdle?
Jim Landers -- Vice President of Corporate Finance
Jim, this is Jim, again. We feel that our cost of capital which all of us could look up or calculate individually somewhere in the low teens. We've traditionally looked for low 20s as a hurdle, because that's risk adjusted given this is a very risky business and we try to be as flexible as we can, both with cost and our capital plans as possible. In the month of December, did we earn that? Potentially not, but that is our long term goal and the levers that we used to push the business and it is a shame that things aren't better for our group. We've been a publicly traded company without the boat manufacturing company for almost 18 years and our market cap on Friday was almost 8 times our market cap in March of 2001, and almost 44 times the market cap that we had when we were spun-off from a former parent almost 34 years ago.
So we -- over the long term have managed that and work that fairly well. As the shut -- the cycles appear to be potentially shallower, and the high parts of the cycle tend to be shorter, we have to keep watching that, but it's always going to be return on capital. So that's how we're going to continue to manage the business.
James Wicklund -- Credit Suisse -- Analyst
Well, having a higher market cap than 15 years ago is an accomplishment in this group, so congratulations. Thanks, guys.
Jim Landers -- Vice President of Corporate Finance
Thank you, Jim. Thanks for your support.
Operator
And next we'll go to Mike Urban with Seaport Global Securities.
Mike Urban -- Seaport Global Securities. -- Analyst
Thanks. Good morning.
Jim Landers -- Vice President of Corporate Finance
Good morning.
Richard A. Hubbell -- President and Chief Executive Officer
Hey, Mike.
Mike Urban -- Seaport Global Securities. -- Analyst
Morning, I was wondering if you could update us on where you stand in terms of spot versus dedicated fleets.
Ben M. Palmer -- Chief Financial Officer
This is Ben. There hasn't been much change in that regard. And then in terms of our level -- our dedicated fleets probably are a little bit different than some of our competitors. Obviously everybody knows about the -- one of our peers, putting out their pre-announced results yesterday and they're to be congratulated, that's very impressive. But as we look at that, it just demonstrates or confirms that there's lots of opportunity out there and we've got the same people, operating our businesses that have for quite a while and we've had a lot of success over time. So I believe we will be able to figure it out and be able to -- we're not in the market share gain, that's more a result than a strategy.
But I expect we will be able to take some steps and be able to to increase our level of business and as Jim talked about earlier, it's really the balance between pricing and activity and we just need to figure out how to get more activity and make sure the level of dedication we have to the right customers that give us the level of activity we need to generate the revenues and the cash flows to give us the types of returns that we expect even in this environment. So we think, we can do better. I can guarantee you that our -- all of us, including our operations folks are dedicated to doing better than what we have here recently.
Mike Urban -- Seaport Global Securities. -- Analyst
So it sounds like the preference is to continue to move toward a more dedicated fleet, and I was ask -- going to be in my follow up and if there was any pause in that strategy even if on a shorter term basis, just given that we're kind of sitting at a -- hopefully sitting on a -- on a low point for the market, there might be some opportunity to kind of capture some upside as that market recovers. And I guess the question is -- are you continuing to have that preference in terms of striking the balance between price and utilization, sounds like it's more utilization, but I don't want to put words in your mouth.
Ben M. Palmer -- Chief Financial Officer
Well, it's always a balance, but I think we're striving for more activity at the appropriate level of pricing, so that's what we're focused on.
Mike Urban -- Seaport Global Securities. -- Analyst
Okay, that's all for me. Thank you.
Ben M. Palmer -- Chief Financial Officer
Thanks.
Jim Landers -- Vice President of Corporate Finance
Thanks Mike.
Operator
And next we'll go to Ken Sill with SunTrust Robinson Humphrey.
Ken Sill -- SunTrust Robinson Humphrey -- Analyst
Yes, good morning. I wanted to beat on that horse a little bit more, so we had Schlumberger and Halliburton both at least paying lip service, the idea that they're not interested in chasing pricing down, they'd rather stack equipment than work at lower rates. You guys have said that before. I mean, part of last year, you guys were, look, we're not going to work our equipment at -- too lower return or willing to walk away. So given their commentary and kind of your history, how do you -- kind of expect pricing to lay out here in the next few months, and do you think it can bottom in Q1 or Q2 here.
Ben M. Palmer -- Chief Financial Officer
This is Ben, I'm hopeful and that's no better -- that's not a -- we are hopefully at a low point, and again for us though, if you look at our margins, our margins are among the best of our peers. So we have some opportunities, you talk about price on a per unit of work, we have the ability to lower that price, if we get the right amount of volume. So we're willing to accept lower margins with the right amount of increased volume. So again, that's what we're trying to strive, that's what we're trying to achieve, and we believe, with the right balance, we can improve our results.
Ken Sill -- SunTrust Robinson Humphrey -- Analyst
Okay. And then just kind of a housekeeping question if you guys could do the breakout of revenues like you've done in the past in Technical Services and Support Services. And I'll turn it over to somebody else to ask questions.
Ben M. Palmer -- Chief Financial Officer
Sure, Ken, absolutely. So the numbers I'am about to give are our service line revenues as a percentage of consolidated RPC revenues for the fourth quarter, so it's the quarter not the year. Pressure pumping was 48.7% of revenues. Thru Tubing Solutions was 29.3% of revenues. Coiled tubing was 5.6% of revenues. Rental tools was 3.8% of revenues, and nitrogen was 3.5% of revenues.
Ken Sill -- SunTrust Robinson Humphrey -- Analyst
Thank you.
Ben M. Palmer -- Chief Financial Officer
Sure. Thank you, Ken, talk to you later.
Operator
And next we'll go to John Daniel with Simmons.
John Matthew Daniel -- Simmons & Company International -- Analyst
Hey guys, good morning.
Jim Landers -- Vice President of Corporate Finance
Hey John.
John Matthew Daniel -- Simmons & Company International -- Analyst
Jim, I guess the first question is when you look at the the total frac horsepower of 1,050,000, what would -- how would you characterize effect of marketed capacity?
Jim Landers -- Vice President of Corporate Finance
We have 16 fleets manned now.
John Matthew Daniel -- Simmons & Company International -- Analyst
16, OK. And where did that trough in Q4? Or is that the trough right now?
Jim Landers -- Vice President of Corporate Finance
That would be the trough.
John Matthew Daniel -- Simmons & Company International -- Analyst
Okay.The two fleets that you're ordering, is there anything different in the design of those fleets relative to what you bought recently?
Jim Landers -- Vice President of Corporate Finance
We got...
Richard A. Hubbell -- President and Chief Executive Officer
They are heavy duty.
Jim Landers -- Vice President of Corporate Finance
Yes, heavy duty.
Richard A. Hubbell -- President and Chief Executive Officer
Heavy duty pumps, may be slight differences, but nothing significant. Now the last group that we ordered were much higher capacity and ability to work more intensely, and these are the same, or maybe even a little more, so, little big there.
John Matthew Daniel -- Simmons & Company International -- Analyst
Okay, so in theory, more efficient.
Jim Landers -- Vice President of Corporate Finance
Yes.
John Matthew Daniel -- Simmons & Company International -- Analyst
They should be, yes. Not in theory. They are. Okay, Jim, I'm just trying to dial into Q1 here and sorry to be the ball and chain on this call, but (multiple speakers).
If pricing is going to decline faster or more than in Q4, and if you're presently at the trough in terms of fleets, it would seem that the revenue compression in Q1 relative to Q4 could be mid-teens again, is that a fair assessment and also the press release talk about the white space or a lack of work starting off the quarter.
Jim Landers -- Vice President of Corporate Finance
Well, that is a view, John.
John Matthew Daniel -- Simmons & Company International -- Analyst
It is a reasonable view.
Jim Landers -- Vice President of Corporate Finance
And it's a reasonable view. On the other side, we are working right now to test the market and see how much higher utilization we can get at acceptable margins, and assuming that bears fruit, we -- revenues could be higher in first quarter than the view you just articulated.
John Matthew Daniel -- Simmons & Company International -- Analyst
Fair enough.
Jim Landers -- Vice President of Corporate Finance
Also oils in the low 50s throughout (ph) in the upper 40s, we don't have holidays thus far, no weather issues, so those things well not huge, could drive revenue higher in first quarter than fourth quarter was. And I wish we had a better -- I wish we had a more certain view of what first quarter look like.
John Matthew Daniel -- Simmons & Company International -- Analyst
Yes, I mean, I wish I did too.
Jim Landers -- Vice President of Corporate Finance
And I am sure, John.
John Matthew Daniel -- Simmons & Company International -- Analyst
I guess, when you look at 16 manned fleets right now, as you look out on the calendar, I mean, we are at the end of January. Do you see 17 manned fleets in February? Right. I mean, do you see -- have anything concrete that would say, your fleet count is going to rise.
Ben M. Palmer -- Chief Financial Officer
I personally do not know of that right now.
Richard A. Hubbell -- President and Chief Executive Officer
There's lots of opportunity to increase the utilization of our existing fleets.
Ben M. Palmer -- Chief Financial Officer
That's right.
John Matthew Daniel -- Simmons & Company International -- Analyst
Right. I'm just -- what I guess -- I'm trying to get to is, do you feel like this point that Q1 is the bottom in terms of utilization and pricing? Who the hell knows? Right. But I mean, just based off, we have some rebound in oil prices slightly, but still not right.
Jim Landers -- Vice President of Corporate Finance
Well, there's potential, Q4 could be the bottom.
Ben M. Palmer -- Chief Financial Officer
Yeah.
Jim Landers -- Vice President of Corporate Finance
Again, huge seasonal impact for us more so than it appears, more so than many of our peers. So hopefully, there's the normal, not normal, but somewhat of a bounce back. We don't have the seasonal drag.
John Matthew Daniel -- Simmons & Company International -- Analyst
The way you kind of characterize the commentary about pricing is likely to accelerate in Q1 on the downside and there's no guarantee that you necessarily pick up more work, right. If you're -- you could lower your price and not have any more work. If that scenario plays out, you're lower.
Ben M. Palmer -- Chief Financial Officer
Yes, but I don't see us lowering, I mean, John, who knows it's not like we're asleep at the helm here.
John Matthew Daniel -- Simmons & Company International -- Analyst
No, I am not trying to get -- it's early and --- I'm just trying to make sure I'm not going -- getting too crazy here. Okay. Well, congratulations on the new fleets. They will be, I am sure welcome addition, and that's really all I got. Thanks, guys.
Ben M. Palmer -- Chief Financial Officer
Okay, thanks, John. Have a good week, then -- see you later.
Operator
And next we'll go to Stephen Gengaro with Stifel.
Stephen Gengaro -- Stifel. -- Analyst
Hi, thanks. Good morning, gentlemen.
Jim Landers -- Vice President of Corporate Finance
Hey Stephen.
Stephen Gengaro -- Stifel. -- Analyst
Two quick things, the first is, when you looked at the 4Q versus 3Q, I imagined and you referenced there's a bit -- that the biggest drop off was pressure pumping, how is pricing holding up in the other product lines in 4Q and into 1Q?
Ben M. Palmer -- Chief Financial Officer
Actually pretty well.
Jim Landers -- Vice President of Corporate Finance
Yes.
Ben M. Palmer -- Chief Financial Officer
We don't -- I would say flat, probably, we've seen some recent firmness in pricing in many of our other service lines and not seeing any pressure, significant pressure at this point in time.
Stephen Gengaro -- Stifel. -- Analyst
Okay and we can obviously do the math. So the drop off in profitability was largely just decrementals on the pressure pumping side?
Ben M. Palmer -- Chief Financial Officer
Yes, that's correct.
Stephen Gengaro -- Stifel. -- Analyst
Good. And then just the second question. As you look out to 2019, I know it's tough right now. But when you think about the Technical Services margin trajectory, I mean, it sounds like 1Q is clearly lower. But do you think that's a bottom? Is it hard to tell? You want to make a guess at this point?
Jim Landers -- Vice President of Corporate Finance
I don't know, Stephen. Tell us the price of oil in April and we will answer that question. That's...
Stephen Gengaro -- Stifel. -- Analyst
51.50 (ph). I know, if it's 70 (ph), where you also would be. Okay, now that's fair, we can. I just figured, I'd ask. That's helpful. Thanks for the color and I'll get back in line.
Jim Landers -- Vice President of Corporate Finance
All right, Stephen, thank you.
Operator
And next, we'll go to Connor Lynagh with Morgan Stanley.
Connor Lynagh -- Morgan Stanley -- Analyst
Just wondering, if I could build off of what John was sort of getting at here. So I understand that your active horsepower, in terms of what's actually working versus sitting on the fence will probably be lower in the first quarter based on what you're saying, and I guess correct me if that's wrong, but can you give us some color for how utilized what you had working in the fourth quarter was. I mean, obviously always we're -- get to see the aggregate numbers , I'm trying to get a feel for sort of true utilization from one quarter to the next relative to what you're saying might require some pricing to improve that number. Any color you can give there would be helpful.
Ben M. Palmer -- Chief Financial Officer
Pricing didn't change much, so utilization falls out, right.
Jim Landers -- Vice President of Corporate Finance
Yes, so you could solve for utilization. There were a few other things, Connor. We pumped more in-basin sand in the fourth quarter than we did the third quarter.
Ben M. Palmer -- Chief Financial Officer
That's true.
Jim Landers -- Vice President of Corporate Finance
And that has a negative impact on revenue. We all sort of know how that runs through the P&L. So that's part of it too. But then, so, utilization declined from third quarter to fourth quarter. I think in your -- the earlier part of your question, you mentioned something about lower utilization in first quarter than fourth quarter. We actually -- that would not be our view right now. And crews are a relatively fungible resource. We mentioned we have 16 fleets manned, but we can move crews around and work more if we need to, plus many of our peers have had some layoff, so we can get that skilled labor if we need to. So remember, we do try to have as flexible an operational model as possible.
Connor Lynagh -- Morgan Stanley -- Analyst
No, that's fair. I mean, I think what I was trying to get at here is it -- it seemed like you have a -- you were saying that the trough in fourth quarter activity is where you are today. In other words, your exit rate was lower than your average, right? Is that correct?
Jim Landers -- Vice President of Corporate Finance
Well, that is right but, the exit rate was the last week in December which was very low. So the exit rate was lower than the average and we see some pickup in the first quarter. The big variable is how does the pricing utilization balance work as we seek that. That's our major uncertainty right now.
Connor Lynagh -- Morgan Stanley -- Analyst
Right, understood, understood. Maybe a higher level one. So I mean, there's obviously a lot of concern in the market around -- if the pressure pumping market will balance and certainly it seems you guys are strongly of the view that it will -- if you're adding capacity. So just, sort of how you see industry supply demand, how oversupplied are we when (inaudible).
Ben M. Palmer -- Chief Financial Officer
And that's a fair question in characterization. But I view it -- again, we don't seek to -- it's not our strategy to increase market share. But there's lots of opportunity out there for us, given the level that we're beginning the year at, how first quarter will turn out, but we should have, we should have all things being equal, lots of opportunity in the next couple of quarters to improve our results.
Connor Lynagh -- Morgan Stanley -- Analyst
Right. Thanks a lot. I'll turn it back.
Operator
Next we'll go to George O'Leary with Tudor, Pickering, Holt & Company.
George O'Leary -- Tudor, Pickering, Holt & Company. -- Analyst
Good morning, guys.
Jim Landers -- Vice President of Corporate Finance
Hi, George.
George O'Leary -- Tudor, Pickering, Holt & Company. -- Analyst
Take a little bit of a different tact and not kind of talk about trying to estimate where the bottom might be. But, just could you just remind us historically, I believe you guys have been a little bit more skewed as a percentage of your customer base toward the private as a percentage of rig count , plus or minus 40% of the rig count is (inaudible). Can you just remind us where you sit today? Where you sat in the -- in the fourth quarter from a private versus public customer perspective?
Ben M. Palmer -- Chief Financial Officer
I don't know that, we have that readily available at our fingertips here. It didn't change significantly and I think it -- what -- and that's illustrated I think in our results, I think the profits as it turns out, I mean, we've seen it now the last couple of years are more likely to and more significantly reduce their activity levels around the holidays and we've experienced that here now, two years in a row, and it just highlights the fact that we need to, if you will diversify, we need to spread that out and find that right balance that we've talked about between activity and pricing and we're working on that.
George O'Leary -- Tudor, Pickering, Holt & Company. -- Analyst
And so then the follow up is, for us as we kind of pull the audience and talk to private players and sponsors and things of that nature, it feels like they're going to behave somewhat like the SMID CAP E&P space, which is likely to cut more than large caps and -- and the IOCs and I think we could potentially, we estimate that the D&C (ph) spend year-over-year could be down something like 15% for those folks. This is the anxiety you express with regards to 2019 customer budgets. Is that part and parcel of that or are you particularly worried about those privates and then what's the strategy for roping in more larger public E&P customers.
Ben M. Palmer -- Chief Financial Officer
Yes George, it's a great question. We're formulating that strategy now. We're also mindful of the fact that there appears to be some consolidation in the E&P space certainly on the smaller size -- smaller side and we can that -- we can be a winner or loser in those scenarios, we've been neither as of yet, it hadn't impacted us, but we certainly want to be there when a potential business combination happens. And we are -- we're looking at ways to approach customers who have -- let's define it this way, who have more line of sight, well lined out logistics and other processes, who can not only say that they're going to have a lot of workforce, but in fact, actually do have a lot of workforce. Let's not forget that job delays and operational inefficiencies have plagued everybody all year along. So sometimes the right customer may or may not have a New York Stock Exchange ticker but may in fact have -- have really good logistical processes, so we look at that as well.
George O'Leary -- Tudor, Pickering, Holt & Company. -- Analyst
All right guys, thanks very much for the color.
Ben M. Palmer -- Chief Financial Officer
Okay George. Thank you.
Operator
And next we'll go to Blake Gendron with Wolfe Research.
Blake Gendron -- Wolfe Research -- Analyst
Hey, thanks for taking my question. So first, we've heard several large purveyors of horsepower, both public and private potentially shopping their capacity around, this might be pre-emptive, just given that your utilization, your existing spreads can improve but maybe this is a back half of 2019 question. If you have seen these potential deals? Is it viable horsepower such that it's plug and play? Or is there additional capital that would potentially need to be put into it? And then secondly, what kind of price would RPC need to see, in order to pull the trigger on some of this inorganic growth?
Jim Landers -- Vice President of Corporate Finance
Blake, hey this is Jim. Can't speak to whether we have or have not seen any deals. So I'll just have to speak from a 30,000 (ph) foot level. More and more as your fleets get bigger and reliability gets more and more important, you need uniformity and consistency in your fleet configurations. And we know that anecdotally from some of our our friends who are maybe have bigger companies than ours who've had that issue. So then there's also the issue of you can't tell how well maintained equipment has been. And then come back to our return on invested capital metric, we've traditionally done better with organic growth rather than through acquisitions and paying a premium for the intangible asset. The going concern value.
So I don't see us doing anything like that in 2019, even if the environment improves tremendously, or significantly, which a lot of people do believe. We are more in the mode of buying good new equipment that we can spec out ourselves and operate in these high service intensity environment. So we're probably not someone who has a good amount of insight for you on that.
Blake Gendron -- Wolfe Research -- Analyst
Okay, understood. That's helpful. And then my follow up, just piggybacking off of some of the other commentary around, PerPetro seems to be departing from the month-to-month or quarter-on-quarter business model. Are there other opportunities to lock in several year term or is the receptivity among your customers such that they want to stay fairly nimble? And then, as you think about the strategy and maybe how you approach potential dedicated customer arrangements in 2019 and 2020, would you be willing to take a price cut in order to lock in, I guess, incremental visibility like PerPetro has?
Ben M. Palmer -- Chief Financial Officer
This is Ben. Again, is it a price cut. I mean, we would look at more of the results and the volume of work and the revenues over a period of time and no doubt to qualify for significantly more utilization, we would have to cut the per unit price. So it's sort of a dynamic formula if you will, but again, if this is responsive, we know we'll have to cut the price to get the kind of volume we're looking for. But at the end of the day, it's a cash flow relative to your capital invested evaluation and we think there are opportunities to improve that metric from relative to our recent performance, so that's something we are looking at, again, trying to strike that balance -- which we are trying, strike the balance between the volume of work and the pricing and no doubt, to get much higher volumes, we would have to reduce pricing, but our returns would -- we would expect that our returns would improve.
Blake Gendron -- Wolfe Research -- Analyst
Okay, understood. Just to rephrase, I guess, on the receptivity part of the question. Are your customers approaching you with similar thoughts on this type of arrangement, or is it still fairly early days, I guess, in terms of germinating the idea with E&Ps.
Jim Landers -- Vice President of Corporate Finance
Regarding multi year arrangements, we are not having those kind of discussions right now, our customers don't have that kind of visibility. The idea of closer alliances is a good topic, it's a very valid topic to discuss. It is too early for us right now to offer a view or to offer a forecast based on really close customer alliances
Ben M. Palmer -- Chief Financial Officer
And based on our historical experience, I think, I would doubt our customers would want to -- and neither would we, I mean, given the volatility in the industry to commit to multi year commitments of pricing, we all recognize, again, there is a lot of volatility in the industry and a lot of variables there, so it's -- the time frame that you are usually talking about in terms of making those arrangements that obviously is much shorter than multi year. It's always subject to change. I mean, we know historically, you can have a great relationship with the customer and if price of oil falls precipitously, they're -- they're probably going to be asking for some additional help, all things being equal, right. Pricing today is at a relatively low level, so there's not a whole lot of -- give available, but where that happens that, the customer is going to have options and, us too, options about where we can go with our equipment, so those multi year commitments probably won't happen.
Blake Gendron -- Wolfe Research -- Analyst
Okay, excellent. That's very helpful. I appreciate you taking my questions. Thanks.
Operator
And next, we'll take a question from Chuck Minervino with Susquehanna.
Chuck Minervino -- Susquehanna Financial Group -- Analyst
Hi, good morning.
Jim Landers -- Vice President of Corporate Finance
Hey, Chuck.
Chuck Minervino -- Susquehanna Financial Group -- Analyst
Hey. I just wanted to touch on the CapEx, just a little bit more. If I heard you correctly, I think like 60-40 split there, maintenance and growth seems to imply that the maintenance, kind of still is of fairly high level relative to revenue kind of expectations for '19? And I -- you have seen years here, where you've taken the CapEx way lower? I was just curious of the thought process there. I mean, if things kind of stay at these levels, do you anticipate that CapEx kind of staying where it is, or do you -- can you flex that down even further? I just kind of wanted to hear what the baseline view there was?
Jim Landers -- Vice President of Corporate Finance
Chuck, this is Jim. Maintenance capital expenditures are concentrated in pressure pumping, no surprise there. And are really a function of utilization. So a general rule is that if utilization of pressure pumping equipment is lower, however, one wishes to define that maintenance capital expenditures will be lower as well. So in a scenario that we are not looking for but a scenario in which we have low utilization in 2019, our maintenance capital expenditures would be lower than what what Ben has quoted.
Chuck Minervino -- Susquehanna Financial Group -- Analyst
Okay, OK.
Jim Landers -- Vice President of Corporate Finance
Also, I'd like to point out and this is -- this news is a couple of quarters old, but if I may refresh everybody's memory, the new equipment that we purchased and took delivery of over the past year or so is better, it has more more continuous duty components, and our capitalized maintenance per fleet is lower than it was a year ago. So that is another -- that is another indicator that maintenance CapEx is under control, and again is also a function of utilization. So that's kind of the best answer I think we would have for you as of now.
Chuck Minervino -- Susquehanna Financial Group -- Analyst
Sure, thank you. And then just, I know, those -- you guys made a comment a little bit earlier, that you're kind of testing the market here, you want to see if you can get that work at acceptable margins. And I would guess, I was just curious, bigger picture, are the customers approaching contracts any differently, seems like in a recycle, there's a different approach. Are you seeing customers approach contracts differently as we kind of enter 2019, whether it would be, are they looking to stay more spot, are they looking to go more dedicated and take advantage of the lower pricing -- pricing that you're not willing to concede at this point? I'm just kind of curious if there was any thoughts on that or things you can kind of relate to us?
Jim Landers -- Vice President of Corporate Finance
It's too early in the year to see any discernible differences between customer's agreement behavior now compared to 2018. They certainly are aware of the over -- oversupply of the market which in large part is due to our increased efficiencies and our ability to work 24 hours a day with better equipment and that has benefited them. So they aren't yet going out for long terms because they think whatever pricing is bottomed. But who knows again, so early in the year.
Chuck Minervino -- Susquehanna Financial Group -- Analyst
And then just a last one. I mean -- you have 16 fleets now, it sounds like manned, if things kind of stay at this level of demand, just kind of curious, do you stay at like where you -- what you see today, do you stay at those 16 fleets manned or would you kind of look to stack more equipment and kind of drive up the utilization of manned fleets.
Ben M. Palmer -- Chief Financial Officer
This is Ben. I think, we're going to have some patience here to see what we can generate in terms of additional volumes, and then we'll -- we're constantly reevaluating, but at this point, there's no active plans to tremendously increase or to decrease the fleet, I mean, we're OK with that level today and but we'll continue to revisit it.
Chuck Minervino -- Susquehanna Financial Group -- Analyst
Great, thank you.
Ben M. Palmer -- Chief Financial Officer
Thank you.
Jim Landers -- Vice President of Corporate Finance
Thanks Chuck.
Operator
Next we'll go to Mike Urban with Seaport Global Securities.
Mike Urban -- Seaport Global Securities. -- Analyst
Thanks for letting me back in. I just had a couple of housekeeping questions. I believe you had ordered some coil and snubbing units that were supposed to start up kind of early part of this year. How many of those did you have, and are those indeed rolling out here in the first quarter or just kind of the rollout scheduled for that equipment?
Jim Landers -- Vice President of Corporate Finance
Yes, Mike, this is Jim. Still looking when they come in, it will be probably toward the end of the first half of the year.
Mike Urban -- Seaport Global Securities. -- Analyst
Okay. All right, so that's more of midyear kind of time frame. And then I guess a similar question on the new frac fleet you guys shipped (ph) kind of a midyear delivery, is that somewhat kind of market dependent at this point, or do you have a clear sense of when we might expect to see those deployed.
Jim Landers -- Vice President of Corporate Finance
We're still working on the specs on the components. We're wanting to make sure we get the right components. As you know, there are lot of different interchangeable things, we want to get the right components and frankly, working on pricing too, so we don't have a hard date for delivery and putting in service of that new pressure pump equipment, let's say end of the first half of the year, just for -- to put a date on it.
Mike Urban -- Seaport Global Securities. -- Analyst
Got you. And then last one for me. Did you have the -- if you could the revenue from snubbing and fluid pumping?
Jim Landers -- Vice President of Corporate Finance
Yes, those are -- fluid pumping is actually a bit bigger than snubbing, but they're both fairly small, so we haven't disclosed those too recently, they are each under 2%.
Mike Urban -- Seaport Global Securities. -- Analyst
Okay. That's all for me. Thank you.
Jim Landers -- Vice President of Corporate Finance
Thanks.
Operator
And next, we will go to Brad Handler with Jefferies. Brad, your line is open.
Brad Handler -- Jefferies -- Analyst
Sorry. Thanks. Good morning, guys. Sorry about that. I had it on mute.
Jim Landers -- Vice President of Corporate Finance
Hey, Brad.
Brad Handler -- Jefferies -- Analyst
Good Morning. Can't help, but come back around, I guess at this point in the call, certainly to a few questions, but are you ordering, just on the CapEx side, first? Are you ordering any other new equipment? I think, you had -- we had discussed the new coil units as part of 2018's capital budget, but are you -- is there anything else that's on order that's -- that would add to your capabilities?
Jim Landers -- Vice President of Corporate Finance
Nothing of significance.
Brad Handler -- Jefferies -- Analyst
Okay.
Jim Landers -- Vice President of Corporate Finance
Just (ph) our pressure pumping coil and snubbing. So that's it.
Brad Handler -- Jefferies -- Analyst
Okay. But that -- the coil and snubbing, are they actually falling into? Maybe I should ask it as opposed to us talking? Are they falling into your 2019 CapEx, the coil and snubbing unit?
Jim Landers -- Vice President of Corporate Finance
Yes, they are. That's a clarification that we probably should have given. Yes.
Brad Handler -- Jefferies -- Analyst
Got you. And I'm sorry, how many, maybe now I'm really trying to get to, how many coil units are you adding?
Jim Landers -- Vice President of Corporate Finance
It looks at this point, like four of the large diameter coiled tubing units per head.
Ben M. Palmer -- Chief Financial Officer
And there are some investments that are trying to increase the capacity of another four or so units as well.
Brad Handler -- Jefferies -- Analyst
Great, thanks.Okay, then I guess back to on the pumping side. In 4Q, if there's a spectrum of what happened in December from a few customers drop, like shutting down and doing very, very little work to many customers just dropping a little bit of work. Where did December fall out on your -- on that spectrum for you?
Jim Landers -- Vice President of Corporate Finance
It was probably a smaller number of larger customers, Brad, but that's just a qualitative judgment call on my part.
Brad Handler -- Jefferies -- Analyst
All of your customers dropping more significantly and certainly...
Jim Landers -- Vice President of Corporate Finance
Yes.
Brad Handler -- Jefferies -- Analyst
Okay, OK. Are those the same customers that are stutter stepping with you now and are trying to figure out kind of how they approach 2019?Or is that a broader set?
Jim Landers -- Vice President of Corporate Finance
It seems fairly random, Brad. In other words, people who really shut down in December may or may not be figuring out what they're doing in 2019. So we know that a lot of people have not gotten their budgets yet. And again, to an earlier comment, October, November and December were bad time for oil prices to fall. And just because that's budget season. So we believe that our customers have not yet set their budgets and made firm plans other than things that -- there are exceptions to that, but things that we don't know.
Brad Handler -- Jefferies -- Analyst
Right, OK. Got it. Thanks, I appreciate it. I'll turn it back.
Jim Landers -- Vice President of Corporate Finance
Okay, Brad. Thanks.
Operator
And next, we'll go to Marc Bianchi with Cowen.
Marc Bianchi -- Cowen -- Analyst
Hey, thanks. Just wanted to clarify a comment, Jim, I think you made, saying that these extra pressure pumping fleets are coming in next year. I just want to clarify, that's 2019 and not 2020.
Ben M. Palmer -- Chief Financial Officer
Mid, yes, that's right. Midyear '19.
Jim Landers -- Vice President of Corporate Finance
Yes. Sorry. We know this is 2019 versus 2018 earnings call. Thank you, Marc.
Marc Bianchi -- Cowen -- Analyst
Thank you. In terms of the -- the activity on the ground, I mean, I know there's a lot of uncertainty for first quarter, but what have you seen so far in January? Is it pretty kind of flat with where the exit was in December. It sort of sounds that way, if you really haven't seen what testing the market will do for your activity.
Ben M. Palmer -- Chief Financial Officer
We have -- as we traditionally do, after a seasonal slow down, we do have, January is better, early January is better than the exit in late December.
Marc Bianchi -- Cowen -- Analyst
Right. Okay. And then the only other one I had was, on the -- on the 16 fleets, could you talk about geographically, how they're positioned, and then more broadly for RPC overall, where the geographic exposure is in the fourth quarter?
Ben M. Palmer -- Chief Financial Officer
Marc, sure, I mean, in very broad brush terms, the center of gravity at RPC is the Permian Basin, a little less than half of our pressure pumping equipment and assets are in the Permian. Then you go sort of low teens exposure in the Eagle Ford, East Texas which is Kilgore, as well as the other work that's going on there. The mid-continent and and in the Bakken is probably 8% or 9%. We did during 2018 move equipment around to help out and try to be flexible. We didn't take any out of the Permian, the anticipated takeaway capacity issue -- did not hit us in a way that's transparent to us, so everything stayed there, but we moved other fleets around and people and they've gone back home too, so that's pretty much the -- that's pretty much the geographic distribution in fourth quarter and today as we start 2019.
We don't do pressure pumping in the Marcellus Shale or the Utica, but our -- many of our other service lines including coil tubing and our down-hole tools and motors, service line, Thru Tubing Solutions, function -- operate in that area as well.
Marc Bianchi -- Cowen -- Analyst
Great, thanks very much. And I'll turn it back.
Ben M. Palmer -- Chief Financial Officer
Thanks Marc.
Operator
(Operator Instructions) We'll take our next question from Ken Sill with SunTrust Robinson Humphrey.
Ken Sill -- SunTrust Robinson Humphrey -- Analyst
Yes, thanks. I just wanted to ask it flat out. What was the average number of active fleets in Q4? You started at 20, ended with 16, was it 18, 17?
Jim Landers -- Vice President of Corporate Finance
It's a valid question. It wasn't 16. It was probably, Ken, it's hard. Let's call it 17 or 18. Split the baby.
Ken Sill -- SunTrust Robinson Humphrey -- Analyst
Yes, that's fair. And then before you guys had talked about how many fleets are 24 hour versus doing vertical work? You still have a few fleets on straight days?
Jim Landers -- Vice President of Corporate Finance
Sure. 24 hour work was 90% of our activity in the fourth quarter compared to 94% of activity in the third quarter.
Ken Sill -- SunTrust Robinson Humphrey -- Analyst
Okay, great, thanks.
Jim Landers -- Vice President of Corporate Finance
Thanks.
Operator
And we'll move to our next question, John Daniel with Simmons.
John Matthew Daniel -- Simmons & Company International -- Analyst
Hey, thanks for putting me back. Jim, this is -- I almost embarrassed to ask this question. But a point of clarification for me. When we were going back and forth talking about whether Q4 or Q1 could mark the bottom were you guys referring to revenue or EBITDA?
Ben M. Palmer -- Chief Financial Officer
We were referring to revenue, John, you're smart.
John Matthew Daniel -- Simmons & Company International -- Analyst
Okay.
Ben M. Palmer -- Chief Financial Officer
And think back on the context of our dialogue that a lot of what we were talking about related to finding that balance between pricing and utilization.
John Matthew Daniel -- Simmons & Company International -- Analyst
Yes.
Ben M. Palmer -- Chief Financial Officer
And so that would imply certainly lower margins if we increase our utilization and lower pricing. But the discussion that we were having was definitely one related to revenue.
John Matthew Daniel -- Simmons & Company International -- Analyst
I'm not as smart as my peers. And I'am just getting confused looking at my model here, but if we go to our math on revenue...
Ben M. Palmer -- Chief Financial Officer
People don't say that about you, as far as you know. So...
John Matthew Daniel -- Simmons & Company International -- Analyst
They're liars. So the -- but with revenues up slightly, I mean, it seems like EBITDA could be down, you reset your accruals, payroll taxes, all of that stuff. I mean, am I missing anything there?
Richard A. Hubbell -- President and Chief Executive Officer
It is not outside the realm of possibility.
Ben M. Palmer -- Chief Financial Officer
That is correct.
John Matthew Daniel -- Simmons & Company International -- Analyst
Okay, that's fine. I just want to -- early still. Okay, guys, thank you so much.
Ben M. Palmer -- Chief Financial Officer
All right, John, thanks, have a good day.
Operator
I'm showing we have no further questions in the queue. I'd like to turn the call back over to Jim Landers for any additional comments or closing remarks.
Jim Landers -- Vice President of Corporate Finance
Okay, thank you. We thank everybody for listening in and spending this hour with us. We hope everyone has a good day and we will see you soon. Thank you.
Operator
A replay will be available at www.rpc.net within two hours following the completion of today's call. We thank you for your participation. You may now disconnect.
Duration: 66 minutes
Call participants:
Jim Landers -- Vice President of Corporate Finance
Richard A. Hubbell -- President and Chief Executive Officer
Ben M. Palmer -- Chief Financial Officer
Marc Bianchi -- Cowen -- Analyst
Chase Mulvehill -- Bank of America Merrill Lynch -- Analyst
James Wicklund -- Credit Suisse -- Analyst
Mike Urban -- Seaport Global Securities. -- Analyst
Ken Sill -- SunTrust Robinson Humphrey -- Analyst
John Matthew Daniel -- Simmons & Company International -- Analyst
Stephen Gengaro -- Stifel. -- Analyst
Connor Lynagh -- Morgan Stanley -- Analyst
George O'Leary -- Tudor, Pickering, Holt & Company. -- Analyst
Blake Gendron -- Wolfe Research -- Analyst
Chuck Minervino -- Susquehanna Financial Group -- Analyst
Brad Handler -- Jefferies -- Analyst
Ken Sill -- SunTrust Robinson Humphrey -- Analyst
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